Debates of Dec. 11th, 2001

The Budget

[The Deputy Speaker]

Let me now rule on the amendment that was proposed by the member for Calgary Southeast. The Chair finds the amendment in order.

As regards the amendment to the amendment put forward by the hon. member for Saint-Hyacinthe—Bagot, it too is in order.

[John McCallum, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, I have two questions for the member. First, almost all of his remarks are based on a fictitious surplus of about $13 billion. Given that he is the only economist in the country with such a far-fetched forecast, my question for him is the following: why should the government believe him rather than all the other economists in the country, unless he is perhaps the most brilliant economist in the land?

My second question concerns health. In terms of health funding in Canada, it seems to me that the BQ and the PQ are talking from both sides of their mouth. On the one hand, they never acknowledge income tax points that we have given in the past as federal transfers. The federal share of government spending in Quebec is actually 30%. They never mention it, because this figure includes tax points. On the other hand, today they are asking that tax points to be transferred; in other words, they want the federal government to provide the Quebec transfer in the form of tax points. After which, Quebec would not count these transfers. So, from the separatist perspective, this is a great idea. However, from the perspective of the federal government or of Canadians who are not separatists, why would such a proposal be considered?

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, as usual, the parliamentary secretary is extremely cynical, and his words are verging on demagoguery and insult.

What I have here in my hands is a calculator. If our Liberal colleague were less lazy, he would take his out, as he did when an economist for the Royal Bank—and a little more objective then than he is now—and would do his calculations as we do, according to the economic growth forecasts by the major Canadian banks and financial institutions, the Desjardins movement, the Caisse de dépôt et de placement du Québec, the Royal Bank, the Toronto-Dominion Bank and so on. We come up with the same figures as the Minister of Finance for the growth of the GDP over the next few years.

However, while making use of the economists' hypotheses—we are intelligent enough here to do some calculations and use some non-partisan discernment—we also use this little thing I showed, called a calculator, and look at the government's funds coming in and going out, the month-by-month expenditures, and formulate certain hypotheses.

I would remind my cynical colleague that, every year for the past five, we have called a press conference to release our estimates of the surplus, six months or often even a year before the Minister of Finance releases his, or before the end-of-year surplus is announced. In five years, we have been out a total of $3 billion, while the Minister of Finance has, particularly since 1995, been $60 billion out in his predictions.

So, why should the public believe us instead of the Minister of Finance? Because they have been deceived by the Minister of Finance for the past five years. For five years, the Minister of Finance has made some unbelievable errors in calculation. For five years, the Minister of Finance has been concealing surpluses. Why now should they favour the transfer of tax points to the government of Quebec?

I can see why he is no longer with the Royal Bank. Because economic analysis is not his strong suit. Once tax points have changed hands, they no longer belong to the one who has handed them over. It is like selling a house; it is no longer yours once you have sold it. The tax points from the 1960s and 1970s for funding health care, education and so on were handed over to the government of Quebec.

If the hon. member wants these points to be taken into account, let us also take into account the tax points that the province gave to the federal government for the war effort, when it gave up its direct taxation field. If the hon. member takes into account the tax points given by both sides, he will be surprised to see how much the federal government owes to Quebec.

Why are we in favour of transforming federal cash transfers into tax points for the Quebec government? For two reasons. First, to protect ourselves against the political decisions and drastic cuts that the Minister of Finance has been imposing since 1995 in the Canada social transfer.

Second, we want the transfer of tax points for personal income tax, because it will grow in the coming years. It has been growing at an annual rate of 6% of federal revenues over the past four years. These are two good reasons.

The third reason is that even a federalist such as the leader of the Quebec Liberal Party is in favour of a transfer of tax points. There is a consensus on this issue in Quebec. The hon. member should know that, since he lived in Quebec for a long time. But it is true that, at some point, partisanship made him forget everything, including his past, his analysis and his qualifications as an economist.

Why should we favour a transfer of tax points? It is for these three main reasons. There may be a fourth reason, which is that we are convinced that the needs are in Quebec. The needs are in the Canadian provinces. These are urgent needs in areas such as health and education. This government does not have the brains to realize it. The budget it delivered yesterday shows without a doubt that it does not have a clue as to what people's priorities are.

[Lorne Nystrom, NDP, Regina—Qu'Appelle, SK]

Mr. Speaker, I have a question for the Bloc Quebecois member too. The people of Canada have another need. I refer here to farmers and farm producers across Canada. There is nothing here at all for the farmers. I have looked through the whole thing. There are 300 pages. There is nothing at all.

Farmers throughout Quebec and in western Canada are facing a major crisis. I am thinking of farmers in Saskatchewan and Manitoba, who are involved in the production of wheat and so on.

What does the member propose for our farmers with regard to subsidies or federal government aid?

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, I am pleased by the question from my colleague of the New Democratic Party, since I used to be an economist with L'Union des producteurs agricoles du Québec. I am still very much attuned to farming issues.

Today, the problem of farm subsidies remains unchanged. In recent years, and especially with the eighth GATT round, which led to the establishment of the World Trade Organization, it was decided to reduce trade distorting subsidies. That was in 1993. It concerned 140 countries belonging to the WTO. It was agreed to reduce these subsidies to a given level annually until they were finally eliminated and to retain only those subsidies that did not have a distorting effect on international prices and exports.

Unfortunately, some countries made greater efforts than others, and Canada is one of these. We were, to put it another way, more catholic than the Pope, as we would say in Quebec. We cut our subsidies more than the Americans and the Europeans, so that, at the moment, prices on international markets remain depressed. Western exporters are facing lower prices on the export market. These lower prices are the result of the unfair American and European subsidies.

So we again find ourselves in a situation like this, where competition hinges not on the quality of our agricultural products—wheat, pork, dairy products, and so forth—but on the subsidies provided by governments of the larger nations or regions in the world. It is essential that the current round of WTO negotiations correct this problem.

As for this government, it has thrown out the baby with the bath water. In attempting to do something about subsidies which were causing distortions, it jeopardized, and is still jeopardizing, the survival of farm families. Even though they are among the best producers in the world, with top quality products and an excellent price-quality ratio in a normal market, they are not able to compete with producers and exporters receiving billions of dollars in subsidies annually.

It is time that the government did something, stepped up its negotiations and took a stronger stand internationally, first, so as to reduce subsidies, which are distorting international prices and, second, to put a little money in the pockets of agricultural producers in Quebec and in Canada, to give them a new lease on life. This is what it will take to keep our agri-food industry going. Otherwise, its survival is at risk.

[Grant McNally, Canadian Alliance, Dewdney—Alouette, BC]

Mr. Speaker, I rise on a point of order. I think you might find consent if you were to seek it that we deem all private members' bills for this parliament votable.

[The Deputy Speaker]

Does the House give its consent to the hon. member to propose the motion?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[Alexa McDonough, NDP, Halifax, NS]

Mr. Speaker, I would like to indicate at the outset that I intend to divide my time with the NDP finance critic, the hon. member for Regina--Qu'Appelle.

I listened very carefully to the budget address yesterday delivered by the finance minister. In that budget address he congratulated himself on the clear-eyed vision contained in the budget. I believe those were the words. I would suggest that the finance minister needs to make an urgent appointment with an optician, an optometrist or an ophthalmologist.

Let us hope that in the process he will discover one of the really short-sighted measures or shortcomings in the budget, which is to give the kind of resources to our health care system and recognize what an important part of the definition of security this is for the average Canadian.

The finance minister also made it clear that the central purpose of the budget was to make Canadians safer and to ensure that Canadians had greater security. I am compelled to say that, even in terms of the definition given by the government, the stated purpose and principal objective of the budget, it has failed miserably. It has failed miserably because its definition of security is so narrow that it excludes a great many of the priorities that Canadians would list if we asked them what things they wanted their government to accept some responsibility for to create greater security.

The budget in many ways is a fraud, a deception. It really is a bogus budget because it conveniently ignores many commitments already made by the Liberal government. It actually ignores a number of things contained in its own red book. There is nothing new about that. It completely ignores previous commitments made but not budgeted in previous budgets. It is very evident that it absolutely dismisses and discards a number of priorities, which the government stated when it brought forth its most recent Speech from the Throne. There are many I could list but I will just give two examples.

One is increasing the security and helping to lift out of poverty first nations people in the country. Second, whatever happened to the commitment to climate change? There was absolute silence in this budget about taking any proactive measures or leadership to finally live up to our Kyoto commitments. Security, at its most basic, is about Canadians having the opportunity to breathe clean air and drink safe water. On those issues the government virtually was silent in the budget introduced yesterday.

What is in the budget? The budget contains a lot of measures that are regurgitated, repeated and recycled from previous budgets, in fact measures that are already implemented and in the financial stream. When we set aside all the measures that fall into that category, what we have essentially is $1.5 billion in the budget that could be described as a genuine allocation of resources to deal with Canadians' priority concerns about security and a mere $1.5 billion that could be described as genuinely stimulative of the economy.

It is absolutely true that there are some measures to deal with airport security and some measures to reinvest in policing and border controls, but let us be very clear that that is only one kind of security, physical security which is important, and we support those measures.

However let us also not forget, even though the government would conveniently like to forget and hope Canadians forget, that what is largely required in this area is to reinvest and reinstate dollars to provide for adequate RCMP and other policing, to rehire immigration and customs officials and others who actually lost their jobs because the government decided that public sector jobs did not matter and that public services were not what Canadians wanted. Thank goodness the government has finally recognized it and is responding to the urgings we have made again and again,

Congratulations for this belated revelation on the part of the government. We welcome its conversion to the view of the majority of Canadians that public services do matter, not just in a crisis, not just in the aftermath of something as horrifying as what happened on September 11, but day in and day out, year in and year out.

What about the security provided by our military? It is true there are some measures in this budget that address the chronic underfunding of our military in a number of important areas. However when we take account of the $510 million already committed in Operation Apollo, what is left is less than $1 billion allocated to the military over the next five years. This is unbelievable.

I come from Halifax. I have a lot of families in my riding, as do my colleagues from Dartmouth and Sackville--Musquodoboit Valley--Eastern Shore, which I think is the longest name of any riding in the country. Does anyone know what those families think of when they think of security? They think of their loved ones, their mothers or fathers, who are committed to military duty for the country and who stand up for Canadians. They think of their loved ones when their jobs require them to fly in a Sea King helicopter, and they are racked with fear and insecurity about the possibility that the Sea King will crash.

My colleague, the NDP defence critic, and I just did a quick calculation of the budget figures. We have concluded that, based on the allocation of dollars in this budget over the next five years for Canada's military, we could purchase one and a half new helicopters in each of the next five years. That is what we have. That is without beginning to address what is needed in the way of more resources for recruitment, for training and for adequately paying military personnel. A great many of those families are not only racked with the insecurity of what it means to have loved ones go off into a military combat arena, they are racked with the insecurity of families who are not even adequately paid and have inadequate shelter.

Security is a dual concept. Clearly, there is the physical security, but there is also the economic and social security, security for the poor, particularly the children, the homeless, the unemployed, low income families and small farmers, who are going through a serious crisis these days. There is the security of Canadians who have to live through the recession.

The finance minister has tried to create the impression that this is a stimulative budget, that it will address many of the economic and social concerns in the country and at the same time give the kind of stimulus that is necessary to ensure that Canada does not tip into a recession.

There is very little basis for confidence that the budget will avert the recession that is surely coming down the road. Today's analysis of the budget makes it very clear that this is not a stimulative budget. It would have required an investment of $9 billion to $10 billion on top of the security provisions that were clearly going to be part of the budget. When we strip away all those already announced, already implemented provisions, the stimulus is approximately $1.5 billion.

I do not know whether Avery Shenfeld, senior economist with the CIBC world markets, was among the 100 economists who said in advance, through the Canadian Centre for Policy Alternatives, that we needed an investment of $10 billion to avert a recession. However, he said in Globe and Mail today said:

“Consumers won't see any immediate income boost or incentive to spend”.On the spending side, the economic activity generated by the government's program will be a long time coming.

If we are going to find ourselves in a recession in the next year or so, it will be a made by Martin recession, one that--

[The Acting Speaker (Mr. Bélair)]

The hon. member knows that she cannot refer to a member by his or her name, but only by his or her position or riding.

[David Kilgour, Liberal, Secretary of State (Latin America and Africa)]

Mr. Speaker, I would like to ask a question to the leader of the New Democratic Party.

Can the leader tell us what she would do, what she would be prepared to do for developing countries, if she were the head of the government? What is her policy on issues concerning the countries of Africa, Central America and Latin America?

[Alexa McDonough, NDP, Halifax, NS]

Mr. Speaker, I welcome the question although I find it absolutely shocking to think that the secretary of state would not be aware of what the NDP's long time policy has been with respect to overseas development assistance.

Let me make it very clear. The first plank in that priority platform would be to do what the government has steadfastly refused to do, and that is to move decisively and dramatically in the direction of restoring overseas development aid to .7% of the GDP. This was a commitment made by the government when it sought office, yet it has brought us an unprecedented reduction of overseas development assistance, down I believe to .25% of our GDP. That is unbelievable. This is less than one-third of what the Liberal government said it would do and far less than what many countries in the world, which are a great deal poorer than Canada, have long implemented in their respective budgets.

[Peter Stoffer, NDP, Sackville—Musquodoboit Valley—Eastern Shore, NS]

Mr. Speaker, I know my hon. leader only had 10 minutes in which to speak, but I would like her to comment further on the budget.

Probably the most serious crisis in the country right now is facing our farmers who provide food for our breakfast, lunch and dinner every day. In the budget there is just a paragraph about having further talks with the farmers and not one red cent to assist our them. Would she elaborate on why the government has ignored such an important sector of our economy?

[Alexa McDonough, NDP, Halifax, NS]

Mr. Speaker, my hon. colleague is absolutely right. We have a serious farm crisis on the prairies, in other sectors of the agricultural economy and in other parts of the country as well. Yet the government's commitment to deal with that crisis constitutes nothing more than a commitment to continue discussions about what might be done.

It is absolutely clear that we need to put in place workable income stabilization programs. We called in advance of the budget for a commitment to do that. That is exactly what the farmers and farm families have called for. That is exactly what farm communities, municipal leaders and business leaders in those farm communities have called for. They know that, if the government does not begin to act on the farm crisis, it will devastate not just the lives of a great many farmers and their families but it will devastate whole rural parts of the country.

[David Kilgour, Liberal, Edmonton Southeast, AB]

Mr. Speaker, will the hon. leader of the NDP tell us specifically what she would do in terms of overseas development assistance? What kinds of programs would she continue? What kinds of programs would she discontinue?

[Alexa McDonough, NDP, Halifax, NS]

Mr. Speaker, continuing overseas development programs when the Liberal government has gutted the existing programs is laughable so I have no suggestions along those lines, although I am sure it was suggestions about eliminating things that led to the paltry budget measures of the government for ODA.

Let me say that I want to give credit where it is due. It is welcome that the government has finally seen fit to commit to some increases, but I am very worried. When I look in the budget for a line item that makes it absolutely clear those dollars have been committed, they are not there. In this budget no dollar amount has been allocated for increased overseas development aid.

When we asked finance officials about this they said the dollars would come out of the surplus, if there was any. I do not call that an ironclad commitment to remove the shame and embarrassment of the government's paltry commitment to overseas development aid. I do not think it gives much comfort to many Canadians who have been fighting for an improved allocation of international development monetary assistance.

[Lorne Nystrom, NDP, Regina—Qu'Appelle, SK]

Mr. Speaker, the budget presented yesterday is really one that contains an awful lot of smoke and mirrors in terms of the wizardry of the Minister of Finance. In fact, there are probably more tricks in this budget than there are in the Harry Potter movie. There is a lot of smoke and mirrors and a lot of bark but very little bite in this budget when it comes to what is really necessary for the people of this country.

The budget is really a budget of missed opportunities on the part of the federal government. The only thing the government addresses is the issue of national security and much of that was under pressure from the United States in terms of our national security budget, which will be $7.7 billion over the next six years. About $2.2 billion of that, though, will be recuperated in terms of a special fee or tax on air travellers in the country.

When I was travelling the country with the finance committee, person after person told us what they really wanted was economic security. The government has missed an opportunity to provide some economic security for the people of our country.

I ask this question: Where is the economic security for Canadian farmers who are suffering and leaving the land? A farm bill in the United States that has gone through the house of representatives will supply American farmers with $173 billion over the next 10 years if it goes through the senate and gets approved by the president. This money is on top of $70 billion already approved and spent in the last four years in the United States. American farmers get four times as much from their government as our farmers get in Canada. European farmers get seven times as much as our farmers. Where is the security for the farmers of Canada?

Where is the security for the 7.5% of the Canadian population that is unemployed? There is an accumulated surplus in the EI fund of $36 billion, much of which is used through general revenues to fund a tax cut for wealthy people and corporations. Where is the security for the unemployed? Why did the government not extend eligibility benefits? Why do we not make sure that the benefit period is extended? Most unemployed people now do not qualify for EI. In fact it is predicted that in Toronto about 80% of those who are unemployed worked in the service industry and will not qualify for unemployment insurance benefits. Where is the security for the unemployed in Canada?

Where is the economic security for our aboriginal people, the first nations of this country? The United Nations human resources index states that Canada is the third best nation to live in, but when using the same index for first nations people Canada becomes the 63rd best nation to live in. People are living in Third World conditions in Canada, yet there is no economic development and no economic security for them in this budget. Why is it not there?

Where is there something about the economic security of children in Canada? I remember very clearly that, twelve years ago, in 1989, one child in seven was living in poverty in our country. Now, twelve years later, the ratio is one child in five, or 20% of all children, living in poverty. Where is the security for children in Canada?

Where is the security for people who need housing? There are many people in need of housing. If we were to build houses in Canada it would create two and a half jobs per house. Where is this in the budget? This is also missing.

Where is there national security for our health system? Our health system has suffered substantial budgetary cuts, substantial cutbacks, in 1995, to the hands of the Minister of Finance. However, yesterday, there was absolutely nothing for our health system in the minister's budget.

Where in the budget is there security for people who need jobs in this country, for the 7.5% who are unemployed, for the 43,000 people that lost full time jobs last year? Then we have some 57,000 people who have part time jobs. Where is the vision for creating jobs?

Where is the security in this country for the environment? Where is the environmental security? Where is the commitment to Kyoto? Where are the funds to clean up waste disposal sites? Where is the money to look for alternative fuels and where is the money to retrofit buildings in this country? It is not there.

Where is that economic security? This is a budget of missed opportunities. I am surprised that the parliamentary secretary can sit there in the confidence that this is a good budget knowing his past record on some of these things.

What is the Liberal vision? Do they have a vision? They have a vision of a low wage, part time economy where there are jobs at Tim Hortons but not at IPSCO in Regina in the steel mill or at General Motors in Oshawa. That is the vision of the Liberal Party across the way.

The Liberal vision is one where the income gap in our country is widening each and every day but bank profits are going up despite a slow economy, with $9.3 billion in profits last year and $9.6 billion the year before. We see the constant vision of a deferral of investment in the human and physical infrastructure in this country which is in need of money now. We see a vision of a loss of sovereignty in our country and of giving more and more control of Canada to people who live outside our borders.

We see a vision of a smaller and smaller federal government. In the 1980s the government represented 16.4% of the GDP and now it is at 11.3%. This is the smallest it has been since 1949. It is a vision that is really an adoption of the Reform-Alliance agenda and the only thing that makes that budget look good across the way is the Alliance Party of Canada. Every morning when the Minister of Finance gets out of bed he gets up and says “Thank God for the Alliance, thank God for the Leader of the Opposition, thank God for the Reform Party and thank God for the former leader of the Reform Party of Canada,” because they are implementing their agenda. This is exactly where they want to go.

Our country needs a new vision. We need a vision where there is once again a role for the government in leading the way in helping plan a mixed economy. There is a role for the government and people realized that after September 11 and the problems with security.

There is also a role for the Bank of Canada to once again assume more of the national debt. At one time about 20% of the national debt was held by the Bank of Canada. The national debt is now down to 8% or 9%. This role of the bank would give the government more fiscal flexibility.

We need a vision in the country where jobs are the number one priority, where yesterday we would have spent 1% of our GDP in terms of investment on infrastructure, housing, social programs and agriculture. That has to be the priority of the government.

We need a vision of creating wealth in Canada by investing in education, training and skills because knowledge is power and knowledge is wealth in the future.

We need a vision where the role of small business is more important. Small business today creates 80% of the new jobs, and 80% of small businesses, by the way, have revenues of less than $1 million per year. That is where a lot of the action is.

We need a vision that has a dream of an environmental society and a sustainable environment in our country where we have a greener economy and a dream of social programs that are fully enhanced and fully funded to create more equality of conditions for all the people of Canada.

We also need a new international vision, where the IMF and the World Bank are democratically accountable to the people of the world and where the WTO is not the new world government and we worship at the altar of large corporations.

We need a vision of more foreign aid, a vision of a world economic development organization so that we could have a new Marshall Plan for places such as Europe and Afghanistan, a vision where we have a tax like the Tobin tax on currency speculation to fund international development and slow down the speculation in currency. This is the kind of vision we need.

I think we also need a vision of having the sovereignty and the independence of our country once again reclaimed, because we are losing our country. Chapter 11 of NAFTA, the national treatment clause of the trade deals, gives more rights to corporations than to people. People working in other countries require a working visa, but corporations can come in without any visa and dictate the rules and buy up our country at will. This has to be changed.

We are selling out our country. Even the boss of the Royal Bank, Gordon Nixon, for whom the member across the way used to work, said in Regina that in the last two and half years 20% of our publicly traded companies on the TSE had been sold out and that 23 of 35 companies on the oil and gas index on the TSE have been sold to foreigners, mainly Americans.

Since 1985 we have lost about 13,000 companies in this country. They were sold to foreigners, mainly in the United States. That includes these companies: MacMillan Bloedel, Tim Hortons, Shoppers Drug Mart, Gulf, Laura Secord chocolates, the CNR, and soon the CPR, and the Montreal Canadiens hockey team, sold to Gillette of the United States.

In addition to selling out our companies, we are privatizing. The government privatized the administration of Canada savings bonds to EDS of Texas last year on June 30, the day before Canada Day, the very symbol of our sovereignty.

In my last half minute, let me say that in the future we are in danger of losing our dollar, our loonie, our currency, as more and more people across the way, and the Reform and the Bloc, are talking about using a currency in common with the United States, the American dollar, which will be controlled by the Americans and the American federal reserve.

I will conclude by saying it was a budget of missed opportunities, but we have great potential to take control of our economy, to take control of our sovereignty and to make this country whole and great once again.

[John McCallum, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, the hon. member is complaining because we did not do his party's $10 billion stimulus when in fact the stimulus we provided was on the order of $26 billion. The point is that because of actions taken a year ago we have $17 billion in tax cuts in this year alone. That is the biggest tax cut this year of any G-7 country. We have an extra $3 billion in health care and we have a number of other items, adding up to $26 billion, which is much more relative to the size of our economy than the Americans are proposing and the Americans have not yet implemented those proposals.

My point is that contrary to what the hon. member said we have in fact had a very large fiscal stimulus, to the point where we are proposing not to pay back any debt this year and possibly next year. If we wanted to go any further we would clearly have to go into deficit, because any further than not paying back any debt is a deficit.

The question I am asking is this: the hon. member must be proposing a return to deficit. Otherwise I do not see how his numbers add up.

[Lorne Nystrom, NDP, Regina—Qu'Appelle, SK]

Mr. Speaker, I think the parliamentary secretary should go back to the Royal Bank the way he is starting to count nowadays. He could take some lessons from the new president of the Royal Bank, Mr. Nixon.

Of the $26 billion that the parliamentary secretary is referring to, some $24 billion was committed in previous budgets. The extra stimulus, or the maximum in this budget, is $2 billion. We have about $1 billion or less in terms of new programs. We have a few other things that were thrown in there, but very little new stimulus.

Even the infrastructure program that they are talking about, which might have $2 billion, and I repeat might have, is dependent on there being a surplus in the next fiscal year. It is not even a line item.

I know you cannot see this far, Mr. Speaker, but when we come across the infrastructure program here in the budget there is nothing listed at all. There is no line item in the next fiscal year or the fiscal year after that. It is the same with the Africa fund of $500 million. The government members say in both cases that there will be money there if there is a surplus.

In terms of the deficit, I just do not believe it. We could have spent an extra $10 billion in this budget. The government spent an extra $2 billion or $2.5 billion. It could have been $10 billion of new stimulus without going into deficit, because part of that stimulus would come back to the federal government in increased taxes. More important, the Minister of Finance has always overestimated the deficit and underestimated surpluses and he is doing the same thing here. In fact in the last seven years he has been out by $75 billion in terms of his mathematics. The minister across the way cannot count. Members opposite have no imagination. We have missed an opportunity in this budget to create jobs and to stand up for the Canadian people.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, first I want to commend my hon. colleague for Regina—Qu'Appelle for the great work he has been doing in standing up for the interests of agriculture in his area and in Canada in general.

I would like to ask him a question. Could he explain to us what the farmers and farm families are going through in his riding? What could the government have done to help them? No new measure is provided to help farm families.

[Lorne Nystrom, NDP, Regina—Qu'Appelle, SK]

Mr. Speaker, indeed there is nothing at all in the finance minister's budget for Canadian farmers. Yet, farmers, that is grain producers in Saskatchewan, Manitoba and Alberta are going through a deep crisis. Many of them have already left their farms because it was no more possible for them to continue without help.

It is nothing at all. There is unfair competition in the world with massive subsidies in Europe and the United States going to their farmers. It is no wonder our farmers cannot compete. They receive very little help. Our farmers are efficient. They produce grain and food in a very competitive way.

I will give an example. Grain farmers get 9 cents on the dollar from the federal government. American grain farmers in Montana and North Dakota get 35 cents on the dollar from their federal government in Washington. In the European Union, farmers in France or Italy get 55 cents on the dollar from their federal government in Brussels. That is not fair. That is why farmers are leaving the land. There was nothing in the budget last night for the farmers of Canada.

[Joe Clark, Progressive Conservative, Calgary Centre, AB]

Mr. Speaker, two events since summer have changed the course of our country. The first was the terrorist attack in September. The second was the gradual onset of what the Minister of Industry last week correctly called a recession in Canada.

The budget tabled yesterday, and a budget widely and deliberately leaked before parliament saw it, should have dealt with both security and prosperity. The budget is a disappointment on both counts. It does precious little to address security and it does nothing at all to encourage the prosperity of Canadians.

This is only a half budget. It is a short term limited response to security and terrorism. It is not a full and honest budget which would set a course for the future. The minister's own officials told the Ottawa Citizen that “There could be another budget in early summer”. This constitutes an utter abandonment of the kind of reliable budget cycle that Canadians could count on.

At the very least, the fact that another budget is already anticipated a few months down the road indicates the government's inability to develop a strong action plan to avoid recession. At worst, that is sowing fear and uncertainty.

Does the finance minister have anything to hide from us? What bad news dos he have in store for us come next spring or next summer? We know the government has stopped paying back the debt. The minister has admitted that debt repayment will be zero dollar in 2002, zero dollar in 2004 and zero dollar even in 2006.

The deficit forecasts are highly suspect. They are achieved by fancy accounting. For example, the government claims to be giving a tax break to small and medium size corporations. It is not a break; it is a deferral.

Those corporations would pay their $2 billion in taxes six months later. Why is that? The only way the government could avoid showing a deficit next year was to shuffle that $2 billion of tax take into next year's revenues. Otherwise the government would show a deficit next year. This is hocus-pocus. This is not fiscal planning.

A major purpose of a budget is to provide certainty to individuals, families and businesses that must plan their own finances. Canadians can draw no certainty from a budget whose timeframe in the minister's own words is only “the year ahead”.

The minister claims to be prudent. Yet the budget shows reckless disregard for a budget's central purpose of providing context and direction for the decisions which individuals, families, workers, taxpayers and investors must make.

The Finance Minister proposes a budget which truly speaks to the type of government this is. It contains no real action plan for the future, nor any true solution to the problems in areas such as health and agriculture or on the issue of taxation reform.

Apart from repeating measures already announced in previous budgets, which is another trademark of this government, one would believe, by reading the minister's speech, that those problems do not deserve the attention of decision makers.

The most ironic line in the budget is when the minister solemnly states:

Let there be no doubt that the plan which brought these benefits will see us through the current downturn.

Two events brought Canada the fiscal windfall of the last few years. They had nothing at all to do with the Liberal government. The first was the economic boom in the United States. Economists and economic policy commentators agree that the second set of decisive factors was free trade and the GST which the government did everything it could to stop.

The government has no economic plan. It never had one. It rode high in the good times and it stands forever accused of having wasted that period of growth when Canada had the fiscal room to take the initiatives that would have kept us among the economic leaders of the world. However this emperor has no clothes.

This is a government that takes no initiatives. There has been no significant economic initiative taken by the government since NAFTA. There is no plan to see us through the recession, which ministers admit exists but which the federal budget, the economic planning document for Canada, fails to mention.

Those are not the hallmarks of an honest budget. This is either a con game or Liberal arrogance at its worst. In either event it breaks trust with the people of Canada.

How can the minister expect our fellow citizens to be able to plan their financial future and that of their businesses and families if he is unable to propose an action plan which has more than a few months span?

The budget is decisive proof of the arrogance of a government too long in office. It is clear that the minister's leadership aspirations matter more to him and influenced the budget more than his responsibility as the economic leader of the government.

The minister needed cash. The auditor general identified 16 different ministries with wasteful spending that cried out for attention. The minister ignored the auditor general and the waste. He refused to cut the spending of ministers whose votes he needs and wants in the Liberal leadership campaign. To make matters worse, the minister buckled when the Prime Minister insisted that other leadership candidates be given tiny trophies from the treasury.

[An hon. member]

A Tobin tidbit.

[Joe Clark, Progressive Conservative, Calgary Centre, AB]

The Minister of Industry, the Tobin tidbit, who wanted $4 billion, settled for $110 million in new money for high speed network technology, which is $110 million more than the desperate and basic agriculture industry received in the budget.

The Minister of Canadian Heritage and the Minister of Human Resources Development are allowed to keep on wasting millions of dollars in their grants and contributions programs despite the clear and repeated criticisms of the auditor general.

In a country in recession the Minister of Finance needs to impose discipline on his colleagues, but the minister is a candidate for his party's leadership and so he does not hold to account the cabinet colleagues whose leadership votes he needs.

There is not a single cent of new money for agriculture. Nor does the budget provide for a rollover of unused safety net funds from previous years as requested by farm organizations. Farmers need a long term vision. They need to move beyond year to year crisis management. The budget provides neither for agriculture.

The same goes for health care financing. The budget contains no new initiative for this issue of such great concern to Canadians.

To use a phrase from another time, the minister had options. He had a choice. He could have used the good economic times of the last few years to bring up funding for health care, defence and other priorities. He could have been a leader in tax reform in those good years when Ireland, Germany and the United States were pulling dramatically ahead of Canada. Instead he drifted through the good times and now has to deal with defence and security issues that should have been addressed long ago.

The contribution to national defence is pitiful. It is an insult to the men and women who serve Canada abroad in whatever theatre. As part of the much vaunted security package the budget gives the Department of National Defence $629 million over five years for the Canadian forces. However the department's own business plan states that it is $1.3 billion short per year to fulfill the tasks already assigned to it. The government adds more new tasks than money.

Once the funds are stripped away, allocated to the current commitment to the war in Afghanistan and earmarked for JTF2, the military would only receive $300 million to deal with capital programs. That would only buy five search and rescue helicopters, or three Hercules planes, or one C-17A heavy transport. There would be no money to replace the CF-18 fleet, the Iroquois class destroyers and the Aurora maritime patrol aircraft fleet. Yet they are all due to be retired by the end of the decade.

The government proposes to invest $1.2 billion itself in a security policy and have taxpayers contribute another $2.2 billion in higher ticket fees.

As regards our border, Canada could have shown leadership by proposing a typically Canadian action plan. However, because of our silence, the silence of the Government of Canada, we have to settle for the American proposal, which provides, among other things, for the presence of American helicopters at the Canadian border.

On the issue of foreign aid, the government has obviously completely wiped out any potential benefits from our contribution to humanitarian aid. By reducing aid levels, as they have done since 1993, they have severely reduced our capacity to act on the international level. The budget tabled yesterday damages but in no way rehabilitates our reputation around the world.

The government's record on foreign aid has been abysmal over the last seven years. We fall well below the OECD average on foreign aid spending. Currently we are at 0.25% of GNP, down from 0.46% in 1992 and far below the UN target, the Lester Pearson target of 0.7%.

The real challenge for Canada is to become internationally competitive again. We must pay down our national mortgage. There should be a scheduled debt reduction plan that would force the government to pay down our debt. The government could eliminate plenty of waste. It could start with the $125 million it is spending on advertising and polling. There is a good place to start.

The budget would repeat last year's pre-election tax cuts. However, after taking into account bracket CPP premium increases and the child tax benefit, that would still keep current levels of taxation above those of 1993. The only major tax break would defer the taxes of smaller corporations, the fancy accounting whose only purpose would be to hide the deficit next year. It is notable that no similar relief is being offered the unincorporated small business owners, farmers or fishermen.

On the transparency and accountability fronts, the finance minister is sending troubling signals about the future direction of his government. Again, we are witnessing the establishment of a new foundation.

Last week the auditor general criticized the government for establishing these foundations. This week the government sets up yet another one. The strategic infrastructure foundation would not answer to parliament. It would be run by a board of Liberal Party friends. It would be another step into the darkness where more and more of the activities of government would be conducted in secret and at great distance from parliament which exists to control the spending of the Government of Canada.

Last week, the auditor general noted in her report, and I quote:

While the foundations will support worthy causes, I am...also concerned that Parliament has only limited means of holding the government to account for the public policy functions performed by these foundations.

She continues:

There are many ways for the government to pursue its policy objectives. It has not yet assessed the appropriateness, the cost, or the effectiveness of this particular vehicle. I think it should.

That she said last week, in saying stop this practice. What did they do? They turned around and they set up another corporation that parliament cannot get at, whose records will be secret, run by Liberal Party lackeys distorting the Canadian public interest.

It is ironic that this half budget, this guise pretends to be a response to the terrorist attacks because those terrorist attacks showed the Liberal government at its most inept. While Tony Blair played a leading role in responding to the terror, there was no one home at 24 Sussex Drive, just as there has been no one home, no leadership on economic policy in a decade. We are paying a price for that now.

The budget yesterday was an opportunity for Canada to begin to face the possibilities of the future, to begin to turn around the growing recession. This half budget is the latest proof that the government is letting Canada down and is costing us our future. Canadians deserve better than this short term, shortsighted budget.